Towards a fair, efficient insolvency regime
The article analyzes India's Insolvency and Bankruptcy Code (IBC) and its 2026 Amendment, which introduces the Creditor-Initiated Insolvency Resolution Process (CIIRP). It highlights the historical tension between preserving distressed companies and safeguarding creditor interests, critiquing the CIIRP's restrictive framework that limits initiation rights to 'notified financial institutions'. This limitation is argued to create an arbitrary hierarchy, disenfranchise smaller creditors, and invite constitutional challenges (Article 14). The article contrasts India's approach with international models like the U.S.' Chapter 11 and the U.K.'s Part 26A, advocating for a 'universal CIIRP' based on financial exposure rather than institutional identity to ensure a more fair and efficient insolvency regime.
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